Skip to main content

tv   Power Lunch  CNBC  September 9, 2015 1:00pm-3:01pm EDT

1:00 pm
>> you think we get a trade in a little bit of a tighter range as the fed gets closer? >> i hope so. i think that's bullish if we do. >> i think we do, yeah, trade in a tight range. but it will be very interesting day next week on the 17th. >> "power" begins now. thank you very much, gentlemen. breaking news. a key apple event starts right now and we'll cover it as the news comes in. this is a live picture of san francisco's bill graham civic auditorium. we expect news on the iphone 6, apple tv and much more. note the price of the stock, just under $113 a share right now. thanks for joining us on "power lunch." along with mandy drury, i'm tyler mathisen and jon fortt is waiting for news. >> look at what apple stock has been up to recently. though shares are down about
1:01 pm
11%, compared to the nasdaq just down 3% in the same time period, apple is also a dow component. but now without further ado, let's get to jon fortt in san francisco. >> reporter: mandy, this is an incredibly important event not just because apple is the most valuable company in the world, not just because the iphone which we expect to see a refresh here today is the most popular product in the world, but because the combination of those two things, and all the companies that are trying to compete with apple from samsung to microsoft to others, all of those futures hinge on what apple announces today. can they continue their momentum in the iphone as they've been stealing share from android. or have they just gotten too big to grow further here. we expect to hear not just about the iphone but also about apple tv and the ipad. right now i can tell you,
1:02 pm
apple's ceo, tim cook, has taken the stage to cheers and is kicking off this event, mandy and tyler. >> jon, quick question. iphone is obviously product one for the company. but my guessing is that the i mad is an area of particular focus to the extent that its sales have sort of leveled off a little bit. that the new bigger iphone may have cannibalized that just a bit. how are they going to reenergize that particular brand? >> reporter: not just a little bit. ipad sales haven't just slowed as far as growth, they've actually gone negative for several quarters now. and that is a concern. tim cook has said again and again he's not overall concerned about the ipad. he still thinks it is going to be bigger potentially than the pc is. but in order to do that, they've got to do some things in software. expect them to come out with a larger ipad today that could be good for productivity around the
1:03 pm
enterprise. it is a big product, still doing billions of dollars of sales per quarter but it has not been growing and growth of course is very important to investors. >> thank you very much, jon. we'll get back to you shortly. now to the nasdaq in the meantime where bertha coombs has been following some of the other big-tech movers. >> apple having a bit of a halo effect today. tech in fact benefiting from a dual halo effect, the china stimulus and this anticipation over apple. apple shares inched lower earlier today on concerns that the fed will hike net we-- next week. watch the apple components, they're all off of this morning's highs. watch them, beyond apple, the big news today is the big surge in netflix. it's on pace to end a seven-session losing streak as it unveils plans to roll out service in south korea, singapore, taiwan and hong kong.
1:04 pm
that china stimulus seems to be trumping iing alibaba's warningt its lower sales. jd.com is one of the gainers today. yahoo! despite uncertainly about the tax implications about its alibaba stake. it was another nice triple-digit rally for the dow. what happened, mary? >> the jobs report, the jolts report gave a jolt to the market. basically said the job openings in the u.s. the highest in 15 years. markets gave up earlier gains. coming into the markets -- or coming into the open the u.s. markets were responding to strength overseas in particular in asia where more talk about chinese stimulus and repetitions or reiterations that corporate tax rates would be cut in japan.
1:05 pm
no new news so the rally didn't have a lot of umph behind it. no surprise as we saw traders pull back. the area on the dow is 15,516. that's correction territory for the dow jones industrial average and we're below those levels right now. goldman sachs received an upgrade from bank of america. boeing trading to the downside. weakness in the oil or energy sector. chevron among -- or the weakest player within the dow 30. consumer discretionary getting a lift from strong gains we are seeing in netflix. technology also higher thanks to continued strength in the chip stocks which we saw yesterday. trading to the downside, cons e consumer staples and utilities. bond yields are anner alternat to the two bonds at this time. as bobbed yields go higher
1:06 pm
investors might move money into there and take money out of utilities. the dow holding on to a 17-point gain but certainly well below its best levels of the day. 10-year notes up for auction. >> hi. the treasury reopened $21 billion in 10-year notes. bid to cover ratio was stronger than recent averages at 2.70 to 137 indirect bidders, 57.5%. direct bidders 13.8%. it was a little bit stronger auction and that could be because the stock market has failed to hold on to the lion's share of its gains. a lot of times when that happens before an auction we see better demand for issues. the 10-year is one of the favorites for the street. back to you. back to apple now. the ceo tim cook has taken the stage at the company's big product event and joining us to
1:07 pm
talk about that and more, ivan fineseth at tigress. he continues to have a strong buy on the stock with with a $130.75 price target. welcome back to "power lunch," ivan. what are the stakes here? what does cook have to do? >> i think three things. one, continue to -- you're going to see a continual movement of form factor aware from hardware based with be baltimore to software bases so they can keep increasing functionality. the second thing will be product penetration. the key thing with the ipad will be additional penetration into theent prays use. ipad is becoming the main point of purchase and point of sale device at a lot of retail stores and a key data collection device for a lot of field activities. that's taking the place of a cash register, the place of paper. people enter their purchases, get e-mailed their receipts. for example, tesla uses no paper. there's no brochure. they take all your information on an ipad.
1:08 pm
they'll send you what you want electronically. more and more companies are doing that. that is a big opportunity for apple. the other part is the stock price. they have over $100 billion in excess cash. they generate $50 billion a year in excess cash flow. they could also return greater than $75 billion a year to shareholders. they do have to right-size their balance sheet but that could -- >> you hit on what's at stake for the stock price here. what particularly today is going to move the needle. you have a strong buy on it now but did you have also a strong buy when it was at the top at record highs? >> yes. when it was down in the mid $ $50s, $60s. >> what's going to get it back up $130. >> i think combination of continuing strong business performance as far as groeft and profitability, continual sale adoption and market penetration
1:09 pm
of their products and their process of returning ska ining shareholders. >> when i think of these apple product event which we cover a lot because they got a lot of products. it is usually built around the unveiling of a new product -- the watch some months ago. the larger iphone a year ago. this one there may or may not be some larger version of the ipad. we had a larger version of the ipad. we went to a smaller version of the ipad. what i seem to be saying here is that the emphasis today may well be on software and functionality improvements. >> just hold that thought for two seconds before you rely, ivan. you can see seconds ago the apple ceo, tim cook, took the stage there. he is waving out to the adoring and cheering audience. he says that customer satisfaction with the watch is at 97%. >> for people who like it, 97%. >> i've heard at least some of
1:10 pm
my friends and group that had has not been that high. but nonetheless, sorry. you can go back to answering ty's question. >> what was the question again? >> seem to suggest that today's event is more about software improvements, functionality improvements been which are a little fuzzier, harder to articulate. when i've got a physical product there that i can grasp, i get it. when someone says well it is going to run four microns thinner and this much faster, doesn't hit me the same way. >> i think the phone's functionality is driven by the apps and software. the more functionality, the more apps and the more capabilities it can do, it drives more demand for the phone. pretty much the basic functions of sending, receiving texts, e-mails, calls is improved upon by all the other features by the functionali functionality. a lot of different things can be used as a zillion different tools. >> here's what you can do now
1:11 pm
that you couldn't before because of these software and app imprchlts prochli improvemen improvements. >> you'll see a more software based functionality. it is will all be on the screen. >> we'll keep getting back to you throughout the event and get your thoughts on every single headline to comes out. the event is under way as we can see in san francisco. new i noeiphones, an updated ap tv. maybe a bigger ipad. "power lunch" is all over these headlines as they cross. you're watching cnbc, the first in business worldwide. stock is up .8%. we'll continue to cover the event. do not go away. [female announcer] through sunday, during sleep train's mattress price wars,
1:12 pm
1:13 pm
save up to $400 on beautyrest and posturepedic. get interest-free financing until 2018 on tempur-pedic. plus, helpful advice from the sleep experts. but mattress price wars ends sunday at sleep train.
1:14 pm
welcome back to "power lunch." i'm jon fortt here in san francisco. outside the and the event that is under way. the luxury retailer -- luxury partier creator is partnering with apple on the watch band and face. facebook messenger is going to be more full featured now on the apple watch, you'll be able to send text messages, audio messages and share location under watch os2.
1:15 pm
air strip does apps for physicians. able to send hipaa compliant messages. a nurse can monitor a baby's hort rate in t heart rate. pushing partnerships, apps, possibilities as they push forward to watch os2 which will continue to power sales. let's bring in john myer. he was offered a job by apple but turned it down. i'm sure you just heard the news that the io2 is going to be incorporating the facebook messenger. are your satisfied? >> i love my watch. the biggest thing i use it for is the notifications. it is pretty killer to that and see text on the go or e-mail. one of the biggest things we
1:16 pm
look for with watch os.2 is for developers to be able to build native apps on the watch. currently it is a big issue with load times because we have to build the apps for the iphone and sort of just send the interface to the watch. >> is this the most exciting thing out of apple today? >> no. it is the iphones. >> and cameras. you are a millennial. we're here to talk about what millennials want out of apple gadgets and devices and software. you are all about the cameras. >> obviously that's probably the biggest piece of news today we are expecting is the incredible camera that apple is continuing to push into these mobile devices. when you look at the millennial space, one of the biggest pieces of excitement with just smartphones in general is this camera in our pockets. the fact that we are expect today is a 4k video camera. . that's pretty incredible. in that it's been in the industry for about a year. samsung's made some advancements in that. but whenever apple moves in this
1:17 pm
direction it sort of turns mainstream. >> back to you in a second, john. to the other jon fortt with more breaking news, sir. >> yes, that's right. watch os2 coming september 16th. that's around the time frame expected. should note it is just before we expect to see ios 9 which is going to be compatible not just with the latest iphones but also with several previous generations. typically apple announces or starts selling the latest iphone right in those last ten days or so of september. we expect to hear the specific date here in this announcement. unusually, apple is not just talking about the iphone here, they're starting off talking about the watch, this is going to be a multi-product announcement, probably making the case for a whole ecosystem of products. so investors should listen for how all these things tie together and perhaps how they all build marketing buzz for one another. at least that's what apple's got to be hoping in an environment where people are questioning whether this big company can
1:18 pm
continue to grow, guys. >> it is going to be available, os2, on september 16th. the stock currently at highs of the day. just by over 1%. is the apple watch going to be the must-have holiday gift this year? >> i think if they put further emphasis on health and on these third party apps i think there is a high chance. one other thing -- another emphasis on the bands is key. >> bands? >> with the bands what we've noticed is that even with surprisingly younger people in the tech space, due to the customization you can bring to the watch, most of the folks i know with the apple watch are buying two, three, even four different types of it bands at a time. that is another thing we expect today, is to have a more variety of these bands. >> do you care about the ipad anymore? >> for me, not so much, to be quite honest. obviously the 6plus iphone hvip
1:19 pm
c cannibalized the ipad. why expect the ipad pro to appeal more to those customers. >> thanks very much. we're going do head back to san francisco for the latest headlines coming out of the big apple product event. plus, turbulence hitting united airlines. its ceo steps down in the wake of a federal investigation involving port authority officials here in new york and new jersey. you will be surprised just how close the relationship is between airlines and politicians. that and more when we return.
1:20 pm
1:21 pm
1:22 pm
welcome back to "power lunch." i'm jon fortt here in san francisco at the apple event where apple just unveiled the ipad pro, 10.9 inches diagonal appreciatement on this ipad, the largest they have made so far. head of marketing for apple, phil schiller with be making the case for an ipad as an extremely affordable computer, running ios 9 being able to do multi-tasking as being a productivity device. this is a device that has slowed in its sales over the years so this launch for them is incredibly important. >> new larger version of the ipad. it is pushing the stock up to around session highs. we're kushtsly gaining by 1.4% for the apple stock and the broader market it recovering from being in negative
1:23 pm
territory. in other headlines today, mcdonald's is planning to switch to cage-free eggs. all 16,000 restaurants in the u.s. and canada will make the transition. however that's over the next decade. next fl . netflix will do a roebl rollout by the end of 2016. netflix soaring by nearly 6%. cowen upgradeded to outperform. walgreens shares up 43% in the past year, today though just marginally in the green. switching over from stocks to bond. quick check of the bond market in the back of the 10-year note auction. let's look at the yield right now. the 10-year is yielding 2.2 2.2. t the major shakeup at united
1:24 pm
irls. its ceo and two senior officials resign amid a federal investigation into whether the airline exchanged favors with the chairman of the port authority in new york and new jersey. how far is too far for united when if comes to getting business done? i scratch your back, you scratch mine. let's talk -- let's talk now about that with eamon javers and phil lebeau in chicago. phil, why don't you take it away? what is the latest and what more, if anything, do we know about both the internal investigations at united and the federal one that seem to have spawned the ceo's departure? >> we don't know much more than what we learned yesterday when the ceo relined along with two top executives from united airlines. i'm not sure we'll hear a whole lot more until there has been more conclusive evidence reached in terms of what happened
1:25 pm
between the ceo and the kro united executives and the former head of the port authority in new york and new jersey, that being david samson. this has also to do with flights between newark and columbia, south carolina where mr. samson had a second home. a lot of people were calling it the chairman's flight. people were saying why were these flights added between newark and south carolina and did it have in ig to do with united as it was negotiating its lease at the newark airport which is its hub, by the way, there in the tri-state area. i'm not sure we'll hear a whole lot more from some time, but certainly this is a day of transition for united airlines. >> eamon, let me turn to you. i'm sure, phil, you'll have some thoughts on this as well. it kind of doesn't surprise me, in a way. i grew up in washington. i remember how congressmen were always, always fightsing for flights between what was then called national airport, now
1:26 pm
reagan national, and their district. amazingly there would be direct flights between washington and let's say knoxville. they would come out of nowhere. i like knoxville. or lubbock. i don't know. so is this sort of the way business gets done and when does it lapse over into something that is inappropriate, a quid pro quo? >> no, it's absolutely not the way business gets done. certainly here on the federal level you don't see this kind of very individual decision that apparently was made here to benefit one particular official to go to his vacation house. that's the kind of thing we haven't seen in a long time here in washington. what you do get is this generalized lobbying by members of congress because reagan national airport is so unique. it has this perimeter rule which limits the distance that long-haul jet flights can travel from reagan. you get members of congress
1:27 pm
lobbying for exemptions to that perimeter rule so that they can fly back to their districts and bring a whole lot of economic ben efit to their constituents n their district or home state. you get this general logic it is for the good of the entire state. congressmen are happy to see, hey, look what i got for folks back home. that's not the case of what we saw in this alleged united air situation. >> there was a much more -- there was an active issue -- bless you, whoever that was -- >> i'll bet there was not a press release put out about this vacation house flight being added. >> but eamon brings up the point of these flights say between d.c. and smaller markets where you might look at it and say, really. how many people are flying between lansing, michigan and washington, d.c. i'm just throwing out lansing --
1:28 pm
>> you keep picking on knoxvi e knoxville! >> i brought this up to a number of people in the industry and everyone says the same thing. even though flights may not be full and even though you may be on it saying there is no way this airline is making money, airlines come back and say even if a portion of those people on those flights fly internationally out of washington and they are paying business class fares to fly out of washington, then that flight to brought them to washington becomes profitable. it is a very murky area in terms of determining when is a route not profitable versus when is it profitable. then of course you have the other added dimension in this case which is why were they added specifically -- >> exactly. that's it. the allegation here is that united airlines had business before the port authority of new york and new jersey having to do the capital improvements to the newark airport, their hub, and also the negotiation of their lease. so there was really -- final thought. >> i was just going to say, this
1:29 pm
reminds me more of stuff that you see overseas than stuff you see at home. doing a little research on this, i found a couple of foreign corrupt practices act allegations in which air services companies were accused of paying bribes to airport authorities in china, mexico and elsewhere in order to obtain contracts to do business there. when you hear an allegation like this here in the united states, it is really startling. >> thanks, guys. very interesting story capturing a lot of attention and discussion. i'm dopey, she's sneezy. >> yes, thank you for that "bless you" by the way. take a look at. le apple stock. up on the news of the new apple watch and ipad pro. now we're only up by .3%. we'll see whether or not we keep losing steam in apple stock. jon, out to you. what's going on? >> reporter: well, they're talking about the ipad pro. phil schiller is still on stage. key facts about this machine -- the a9x chip, successor to their
1:30 pm
last generation, apple say is it is 1.8 times faster. on graphics it is more than twice as fast as the previous generation. they are saying that it is faster than 80% of portable pcs shipped in the last 12 months. no pricing yet on it, but as evidence of its power with be they say an i-movie you can edit three streechls 4k video simultaneously. ten-hour battery. four-speaker audio. three times the audio volume of the last ipad. it's thicker than the last generation ipad at 6.9 millimeters versus 6.1 for the previous generation and weighs as much as the original ipad. but remember this thing is a lot bigger. it also comes with a smart keyboard. seems like it is just for this ipad pro. will not necessarily fit earlier versions of the ipad. it is a physical keyboard which mirk soft has had with the surface and other windows
1:31 pm
competitors have had for a while. but windows coming out with their first physical keyboard made of a woven fabric. so continue to listen in on this event and bring you pricing and other details. >> jon, can you still hear me? the fact that. ale stock has now gone slightly negative. can you guess what it is in particular that investors have latched on to that might be the disappointment that's made the stock lose its gains. >> no idea, mandy. this event is still ongoing. it's possible that it has something to do with the feature of the ipad pro that's not available on other platforms but too soon to say. we'll just have to continue to let the event go on. indeed it will. we'll get back to you shortly. the overall market is also losing steam now. the dow is down by 44 points. wti crude, the close will fall at 2:30 eastern during "power lunch." that's also losing steam. it is currently below $45 a barrel. we'll keep on watching the markets and of course the apple
1:32 pm
event as well for you right here on cnbc.
1:33 pm
1:34 pm
1:35 pm
welcome back to "power lunch." i'm jon fortt here in san francisco at the apple iphone and more event. they are talking right now about ipad accessories. a couple of them. we talked about the keyboard. now they are announcing apple pencil. some people at samsung might be chuckling right now because they have had a stylus as a key part of their tablet strategy for a while. so has microsoft of course with the surface. right now on stage is one of the executives over microsoft office demonstrating how apple's pencil works with the ipad. got that? okay. it is important because the ipad is still the number one topic, those apple is following competitors on both the keyboard and on the stylus or pencil, as
1:36 pm
they call it here. clearly a push on both counts to try to amp up the productivity cred of thele ipad that is part of ceo can tim cook's push to invigorate ipad growth. he's partnered with ibm and most recently cisco. the pencil and keyboard, of course apple must hope will enable workers to do more work on ipads and perhaps make a case for them to get new ipads and ipad pros instead of pcs running windows 10 which has just launched -- wait. let's go to sue herera for a breaking news -- news check. >> thanks so much, jon. here's your news update this hour. secretary of state john kerry on capitol hill to brief lawmakers on the syrian refugee crisis. he said the u.s. needs to do more to help thousands of migrants and refugees that have left the war-torn regions. the iraqi military releasing videos it says were air strikes on isis targets in western iraq
1:37 pm
on tuesday. it said the strikes caused heavy losses in men and equipment. iraq received four f-16 fighter jets from the u.s. in july. more are expected to be delivered. luf stanza pilots on strike for a second day, grounding over 1,000 flights and affecting 140,000 passengers. the pay lots are striking over retirement benefits, salary and the airlines' plans to expand its budget airline operations. the nfl has asked bruno mars to perform at super bowl 50. the singer song-writer was also asked to produce the show meaning there could be impressive guests to perform with him. he hosted the show just two years ago. >> he was dynamite. wasn't he? >> he was really great. >> love bruno mars. thank you very much, sue herera. gold prices are closing right now to the negative. currently sitting at $1,102, a
1:38 pm
three-week low. silv silver, copper, palladium, platinum all moving lower except for copper. as for stocks giving up their early gains, the nasdaq still very slightly positive. just very slightly. the russell 2000, small caps, also in the red. among the biggest dow percentage gainers today, goldman sachs, boeing and united health has now turned neglect tifativnegative. at the nasdaq, biggest gainers are health care stock. wafergen and ake bmplt iakebia. how do you invest with these wild swings? joining me now, two market
1:39 pm
strategists and gentlemen, thank you very much for joining us. this is the new volatile world we live it. you can have a triple-digit gain on the dow, then boom, you can suddenly lose it. how do you trade how you invest in an environment like this? >> i think the key is to really think about the latter part of what you just said, how do you invest. most of our clients are investors, not traders. the way we are advising our clients to think about what's happened over the past few weeks, is look back at look at the environment. two things, one, fundamentals really have not changed that much despite the fact that we've seen this spike in volatility. we knew that china was slowing in its manufacturing and exports sector. but data continues to project an economic expansion. secondly, investors need to recognize that corrections even in a bull market are actually fairly common. since 1940 we've had 22 corrections can of at least 10%
1:40 pm
in the context of existing bull markets. typically they end up being buying opportunities for investors. if you look at the average 12-month return after stocks correct 10% during bull markets, you get 19% to 20% return off that level. >> paul, you are mr. global. do you think the united states is still the best bang for your green buck or would you be looking at other places? >> that's right. we do like the u.s. first but we're also impressed with how the european recovery has come along and we like japan as well. we'd go u.s. first, developed countries second, emerging a distant third. but would reiterate advice to react here. not to overreact. we think china's still stable. woer worries from last week very much exaggerated on china. >> why do you think they are exaggerated? >> look, this is a country that's slowing by design. its manufacturing sector is according to their forms supposed to consolidate, this is what we should be seeing. the question is whether the economy can remain stable.
1:41 pm
there have been some other indications of slowing especially in trade lately but we think the government is going to be stepping in. they already have begun stepping in this order to keep that economy stable going into the end of the year. >> i guess the question is whether or not the government and pvoc still has credibility. i see technology is your preferred sector. it would be remiss of me not to ask about apple in that space in light of the big event today. >> i don't comment on individual securities but fundamentals for the tech sector look quite positive relative to the broader market. it is rare that you get the opportunity to bip the tech sector at a below market multiple particularly when earnings are expanding faster than the markets earnings growth rate. right now tech is trading at a sector level at 14.8 times forward earnings. the market is trading closer to
1:42 pm
15.5. typically tech trades to a 15% discount. the beginning of the year the fundamentals for technology continue to look impressive. tech grew 6% year on year where the market earnings growth rate was close to flat. that's even with a bigger than market headwind -- market average headwind from the dollar and strength of the u.s. dollar creating difficult currency tranalation effects for most tech companies. >> thank you very much for joining us. paul, your year-end 2015 target is 2,150 to 2,250 for the s&p. go to "power lunch" ppowerlunche more. apple stock, still a wild right. up 2%. next an analyst who has 20% up side from here. here's where the street stands on apple.
1:43 pm
26 have a buy rating, 7 say hold, 2 say hesell. here's tim cook introducing the you in ipad just a few minutes ago. >> this is the ipad pro. it's the most capable and powerful ipad we've ever created. it is chock-full of amazing advanced technologies and innovation.
1:44 pm
1:45 pm
recapping the headlines -- bank the america upgrading gold man b man sachs from buy to neutral. st. jude medical ceo will retire in january. the medical devicemaker coo will replace him. the stock up 8% in the past year though today it is down by 2%.
1:46 pm
today is national career day. chipotle going on a hiring spree to celebrate it. they'll hire 4,000 workers today. that's a 7% increase to its workforce. the stock however is down by 1.2%. apple unveiling a new and bigger ipad called ipad pro. welcome my tech experts back. gentlemen, this seems to me to be a play for the enterprise space. they want all of the hertz agents checking your car in to have ipads. they want retail checkout peek to carry ipads and check you out this way. that's what this says. >> that's what we've been thinking all along. right now they're portraying it so far as way more of a creative device to be used by artists. they just announced film editing
1:47 pm
with their pencil will literally project tilt on the screen. seems like that that's something that might be well received. >> we've come back to the pencil. what do you think of that? >> well, i do think that the enterprise represents apple's biggest opportunity. it is used more and this more. point of sale -- a point of sale tool. >> why have they not been -- i'm not saying they're not successful there. i know they have some penetration there, but why has that not been their strong suit? strategic choice? >> most legacy enterprise software is still pc-based. and also oracle, the actual back-office operating firmware is not even windows based. >> clearly a lot of the workers in a lot of enterprises carry iphones, use ipads, have macs on their desktops at home so it shouldn't be that tough for them to crack. >> i'm sure the adoption will be more than welcome.
1:48 pm
it is the software conversion and that's the biggest opportunity. >> i think one of the reasons over the past three months apple stock has suffered is because of the turmoil going on in the chinese market, concerns about the economy and stock market there. considering its exposure, are you worried at all about apple's exposure to that market? >> not really. because i think china, the economy will gradually slow but demand will still be strong. and many has still tremendous opportunity to penetrate that market and other markets globally. >> even with reports, for example, that one of the leading smartphonemakers over there might be going to encroach increasingly on apple's territory, like launching something that might compete with the mac book? >> i don't think it is overa zero sum game. also i think apple has the largest and most loyal customer base of in he company in the world right now. >> talk to me about your age cohort, the fascinating millennials who we spend so much time thinking about. >> it's almost a dirty word these days. >> wring your hands over. but are they lining up to buy
1:49 pm
apple products the way they once did, or are they -- now do they go, maybe samsung has this, or maybe amazon has this? are they a little less enamored of apple as a brond than they once were? >> i think we've seen a few interesting waves over the past few years. two, three years it was much more the end of samsung and android. most recently with the iphone 6 and 6plus, i think we'll see a lot of excitement around these devices because of the heavy emphasis on camera tech on these phones, the intergration with the watch. i'm sure we'll see pretty high demand for these things come holiday season. >> you mentioned earlier the application in medical offices as a device for physicians to use. my doctor does everything on it. we'll break away and go to jon fortt. >> reporter: got more detail on this ipad pro for you. pricing starts at $799 for 32
1:50 pm
gigabytes. goes up by $100 if you want 64. another $100 if you want 128 gigabytes. higher prices for lte as well. comes in silver, gold and space grey. finishes that apple pencil will be $99 and the woven fabric keyboard, $169. all available in november. no specific date in november given but in time for the holiday season. something i want to highlight, all of the applications that apple mentions for the ipad pro, perhaps appropriately are enterprise, are work applications. didn't talk at all about gaming as they normally do during ipad presentations. and didn't really try to get down further in terms of price. that's a reversal from what apple had been doing with the ipad mini, even pricing on older ipads, trying to bring that down might reflect something about the tablet environment where competitors continue to press on price. we expect to see a 6-inch amazon
1:51 pm
hire hd, down $49 from last year. apple trying to push for higher margin and higher capabilities in the ipad rather than even compete on prices they had in the past. >> apple the only group that could get away from charging $899 for a pencil. -- $99 for a pencil. we know it is a lot more than a pencil. $99. there is apple. down very, very fractionally on the day today. we'll be right back.
1:52 pm
1:53 pm
1:54 pm
welcome back to "power lunch." i'm jon fortt here at the apple event in san francisco. tim cook is on stage now announcing the next version of apple tv. he's barely started so we don't have a lot of details yet but he just finished -- or apple just finished talking about the ipad lineup changes. i'll run through a few of those for you. the ipad mini 4. that will be $399. slightly upgraded. the ipad mini 2, the price has dropped a little bit. i spoke too soon a few minutes ago when i said they weren't doing anything on price. they are indeed. the older ipad mini device now at $269.
1:55 pm
they have quite an extensive lineup of ipads from the mini 2 to the mini 4. the ipad precluding accessories like the pencil and keyboard. ranging from $269 to above $1,000 if you talk about the ipad pro full storage at 128 gigs and lte. we'll continue to listen in on details of the tv. aside from the phone, it is probably the most highly anticipated announcement of today. so many of us watch, guys. we'll be right back. is morning in a security breach that didn't happen.rning wall street. not rattled. at all. no. not at all. not at all. i mean, look at the day. sir. sir. what went right? what went right? everything. thank you. with threat intelligence, behavioral analytics, and 6000 experts, ibm security will help keep you out of the news.
1:56 pm
my dad's company wasn't hacked today. cool. or the freedom to choose what doctor you want to see. so if you have medicare parts a and b, consider an aarp medicare supplement insurance plan, insured by unitedhealthcare insurance company. like all standardized medicare supplement insurance plans, these let you choose any doctor who accepts medicare patients. you're not stuck in a network, because there aren't any. plus, these plans help cover some of the part b
1:57 pm
medical expenses medicare doesn't pay. so why wait? call now to request your free decision guide and find the aarp medicare supplement plan that works for you. like all medicare supplement plans, you'll be able to stay with the doctor or specialist you trust, or look for someone new - as long as they accept medicare patients. but unlike other plans, these are the only ones of their kind endorsed by aarp. rates are competitive. so call today. and learn more about choosing the doctor's you'd like to see. go long. dad: he's our broker. he helps looks after all our money. kid: do you pay him? dad: of course. kid: how much? dad: i don't know exactly. kid: what if you're not happy? does he have to pay you back? dad: nope. kid: why not? dad: it doesn't work that way. kid: why not? vo: are you asking enough questions about the way your wealth is managed? wealth management at charles schwab
1:58 pm
welcome back. everybody. the big apple event in san francisco is continuing. our jon fortt is there live for all the headlines. in the meantime, the stock is kind of flat-lining. >> basically where it started or a little tiny bit than where it started an hour or so ago. >> 112.26 right now. the s&p heat map behind us, the s&p itself is down by .5%. certainly it isn't apple that is the s&p's darling this year. it is amazon which today is up by .7%.
1:59 pm
>> you have relatively modest declines. but look at the breadth of the market here. it's basically 8 out of 10 of the s&p stocks are negative. so most of your stocks today are in the red. maybe 100 of the s&p 500 are in the green right now. we will a have a lot more continuing here on apple and the rest of the market today. . >> and the tv, maybe a vote activation feature. we'll hand it over to brian because you will continue coverage of the event. bizarrely right now, there is a great cnbc app on apple tv. hi, everybody. mandy and tyler, thank you very much. 2:00 now on wall street. 11:00 a.m. in san francisco.
2:00 pm
the dow now at session lows. oil down more than $1 a barrel. apple is where all the action is today. of course, that is where we begin. welcome, everybody, if you're just joining us, apple holding a big event in california right now. so far we've seen a new larger ipad, a tablet that has a keyboard and a stylus to write with, as well as new additions to the apple watch. cnbc's jon fortt is in san francisco. >> reporter: and tv is the subject of right now. apple has revamped it. they've just done an intro. siri and voice navigation going to be a key piece of what this device can do. he is talking about being able to navigate through several different layers of the interface. he said in the beginning show me animate movies, just the new ones. things like that. you got to keep in mind, amazon, amazon fire tv has had voice
2:01 pm
navigation for quite a while. amazon also owns a database of lots of movie and television information. apple's not the only one in this game. but apple is king when it comes to over the top content people pay for, tv everywhere as it is sometimes called. that's why so many in the media industry are paying so as much attention to what apple is announcing here. consumers of apple products are likely to actually pay for what they watch if apple can create the right kind of experience. we'll continue to watch to see if perhaps they have nailed it. >> apple is the master of rerolling out stuff they kind of already have. i'm an avid user of apple tv. i know it has a cnbc app. last night if you used the remote app on your iphone you can use voice activation or siri to search for programs on apple tv. the capability already exists.
2:02 pm
is this a next level? >>. sounds like the next level because of what they announced here. sounds like siri continues to listen. you can say first, show me animated movies just the new ones, or show me movies with a particular actor or show me movies in a particular series of movies, it seems to be not just voice search, simple voice search, but a little bit more intelligence on the back end. what is going to be important to see is how apple mansions discovery here. when tim cook took the stage before he introduced eddie q, he said the future of television is apps. there are a lot of apps potentially out there. apple has talked about the tens and hundreds of thousands of apps that exist for the iphone and ipad. when you get 10,000, 100,000 channels, it gets really hard to navigate so it is going to be very key for apple to do the right kind of search and discovery technology on the back end to make this -- >> every time i log into the
2:03 pm
apple tv there seems to be a new app. you bring up a good point -- the apps are starting to look like channels. dare i say. see you in a bit. products are nice but what shareholders care about is how they might impact the stock price. ivan fineseth of tigress financial partners, and dan eisen. ivan, the stock is not moving now. anything you have heard so far that will make you ramp up your targets or your estimates on apple? >> everything i've heard i've liked so far. i like the new ipad. i think it will be a powerful enterprise device. i like apple tv because it extends the apple ecosystem to the living room. i would really like to see a physical apple tv but the set-top box that they have, the functionality is incredible and it is all about apps and channels. >> but again, not to harp on this point, i've had an apple tv -- i've had the big one. now i've had the little smaller black one. the product has been out for a number of years. i think i got mine in 2010 or 2011. has it made that much of an
2:04 pm
impact? if not, why would it down the road? >> i think -- >> just trying to play a little devil's advocate among all the apple hoopla. >> the halo effect of apple products is very incredible. when you buy one, you tend to buy another an another. the watch extends to the phone, the apple tv, and the watch and the phone extend to your content viewing from apple itunes. apple tv will allow large-screen viewing of your content and access to apple and content from itunes. >> dan, i want to ask you a question about the ipad pro plus the stylus. given the pricing information that we have and the push towards getting that professional market, are we in danger of perhaps cannibalizing for mac book air sales or is there a new market that's currently not using mac book air that might use the mac book pro in your view? >> the cannibalization is definitely a potential headwind. but they are going aggressively
2:05 pm
dead-set after the enterprise market. it is 10% of revenue. that really would be ideally 15%, 20% of revenue. you saw the cisco partnership a few weeks ago. microsoft on stage. that's what apple is trying to do, create another leg to that stool on the enterprise with these larger ipads. it is really the enterprise market. that's the focal point and that will be the big thing we see over the coming months and year as we expect more partnerships, microsoft, cisco, just the tip of the iceberg. >> do you have a sense of what the market is for the enterprise segment in terms of the end reserves? a lot of health care, for instance? i think all of a sudden with the stylus doctors can walk around with their i paipad and notes a patient's bedside, you can also have remote monitoring of patients. >> health care is one of those
2:06 pm
verticals they'll aggressively go after. i think they'll have more partnerships around that in the coming weeks. they're trying to create that echo system, puppet the fence around the -- on that enterprise. going scary after microsoft on that enterprise front. it apple is trying to create that next leg of growth around that enterprise which has been the achilles heel. that's been a black cloud around apple. now they finally have a product to go after the enterprise. i think that's why you saw a lot of applause in there as this is long overdue and a breath of fresh air. >> i'm trying to understand the headlines that just crossed at the bottom of the screen. it says the new apple tv will have a touch surface which i find weird because the apple tv is a small device. they must be talking about the remotes. the remotes now are about the size after cigarette lighter.
2:07 pm
they're terrible. you lose about 100 of them a year in the couch cushions. what do you think they are talking about with the touch surface? >> i think you'll also be able to use your phone and tablet as remote as well. >> apple has created categories. they've created products we did not know that we needed. everybody bought within a couple of years. it seems they were's just tweak being the existing categories, to me. >> or extending these categories. >> are they building new categories? >> i think the apple tv will korea it a new category. the apple watch has created a new category. the apple tablet created a new category. the ipod created an expanded category. >> thank you. if you're out there, we might hear from you guys again. it is certainly a fluid hour. certainly apple is a big part of the dow. there's much more to the dow than just apple. right now the dow is near session lows.
2:08 pm
let's check on some of the other names you might own that are in the market and on the move on this very busy apple day. the dow industrials down 100 points right now. at session lows. cisco systems, wells fargo, gilead and comcast are up. >> the nasdaq is five points off of its session lows. giving up most of the gains it made earlier. some of the most active movers here at the nts -- apple, no surprise. as we monitor this apple event we are awaiting big news, that is the details about the phone. yahoo! trading higher, up 17.4%. stay tuned, we will have more news about the iphone as we get it, brian. can a business have a mind?
2:09 pm
a subconscious. a knack for predicting the future. reflexes faster than the speed of thought. can a business have a spirit? can a business have a soul? can a business be...alive?
2:10 pm
[is the staying awake part...t challeng( gun shot )your day sleep train has your ticket to a better night's sleep. because when brands compete, you save. through sunday, during mattress price wars, save up to $400 on beautyrest and posturepedic.
2:11 pm
get interest-free financing until 2018 on tempur-pedic. plus, helpful advice from the sleep experts. but mattress price wars ends sunday at sleep train. ♪ sleep train ♪ your ticket to a better night's sleep ♪ ge having a nice week after european regulators okay'd their deal to buy a power unit. a can't-miss interview with the chairman and ceo of ge, jeff immelt. tomorrow morning, 9:00 eeastern 6:00 a.m. pacific right here on c nshs. > cnbc. a number of companies and their stock tend to move when apple moves. yes, frogger.
2:12 pm
>> i remember playing when i was a youngster. they reintroduced a newer version. the apple product ecosystem made possible by a network of hundreds of suppliers all providing goods and services to make all those apple products and innovation possible. apple actually publicly discloses the top 200 members of its supply chain on its website in 2015. we took the list, looked at the ones publicly traded here in the u.s. many aren't public, not even public companies. they're certainly not in the u.s. we then asked our data partners at kensho to look at stocks here and how they typically trade and how they do on the day of iphone announcements specifically. there have been eight. some of the more noteworthy winners and/or performance
2:13 pm
standouts, omni vision. up only half of the times. results were skew by a big gain in october of 2011. it was rumored that it supplied camera sensors for the iphone. skyworks solutions up 1% on average but a coin toss as to whether or not it is positive. nxp, semiconductors. apple has unveiled a phone, it is up 75% of the time and posts an average gain of 2%. apple stock has traded lower generally speaking on 6 of the last 8 iphone announcement days. we'll see how things hold up today especially with a market that seems to have lost a good deal of momentum from the highs this morning. so much to watch on an apple day like today. joining us, ari levy, cnbc's
2:14 pm
senior technology reporter -- the bridge in the background gives it away. he is also out in san francisco. ari, these companies, most of them, are pretty wonky during the guts of system. any particular companies you have your eyes on? >> a company called tech data. we're not talking about so much the suppliers here as much as the reseller. tech data is a company that sells a lot of equipment and gear to businesses, make sure that the whole pipeline is running smoothly. that stock is actually one of the very few in the whole apple supply chain that's had a great run over the last few months. it is up 11%, 12% over the last several months. there must be optimism here that many of apple's products are going to start to filter their way through the enterprise. apple has had partnerships announced with ibm and cisco in the past year. so this idea that if tech data can be at the center of a lot of this reselling, that's got to bode well for the company's
2:15 pm
financials. >> these are names that we rely on guys like you to dig out, because this is not the consumer facing stuff. is it? this is not the crossy roads. this is not the apple tvs. this is stuff that's deep buried in the software or hardware. >> it. doesn't have a ton of analyst coverage either. analysts that cover these stocks tend to cover 20, 30, often 50 different companies so their responsibility is pretty vast as this ter pertains to these particular stocks. you have to really dig into the financials and see what percentage of revenue is tied to apple. in the case of tech data, it is 17%, 18%. hp is another big supplier. >> jpmorgan had a report out saying retail values of the 6 are really high this year. what's that mean for tech data and people willing to trade that phone in? could that be a good thing? >> it's not completely clear where tech data fits in to the resale environment. continuically when you talk about consumer resell there are all sorts of websites that
2:16 pm
foster that sort of activity. there are new companies, company called i-cracked out here that will send someone to your door and pick you have your iphone so you can get cash value for it. really where the benefit for a tech data is on the enterprise side as products have to pass through through big warehouses and get to big corporations who's going to handle that, inventory it, who's going to manage that whole flow. that's where they excel. >> ari levy, we will leave it there. thank you, see you soon. let's go a few blocks west. joan jon fortt. a lot of headlines crossing on apple tv. what sticks out to you? >> a few things. right now. gilt, sounds like an app that's going to allow shopping from the television set which makes sense if you see images of thinks you might want to buy pretty large. we'll see how they fit payments
2:17 pm
into that. you about a few other things that peel back some of the features apple is building into this apple tv device and the remote capability. there was an app called beats sports that they were showing off a bit ago. the remote has motion control. remember wii sports? you can swing a bat, hit balls and do that not just i believe with the remote but also with your iphone if you're looking to do something. multi-player. multi-player is enabled in apple tv. now there are a few content providers that already have apps out. this will be open, anybody will be able to create apps. netflix, hbo, hulu, those who already have apps on apple tv. but there are also games. galaxy on fire. disney affinity. guitar hero. remember that one? a fitness app that works with the aarple watch. you have a he got your heart rate here, you have a fitness app taking you through some paperses there. also air b and b and zillow. so real estate angles for this as well. lots of different angles.
2:18 pm
in gaming it seems to be casual gaming that they are looking at with controls that aren't overly complicated. maybe simple motions. a couple of buttons. not the button mashing first person shooter games that we've seen so far. but it is a big segment of the market that is been big on mobile. apple is trying to bring some of that excitement to the big screen. we are see if they are successful. it drives a lot of sales. >> i love that we are going back to the future a bit. talking about crossy road -- simple motion, the stylus. i kind of dig it pass an older guy, it is kind of nice. next thing you know we're going to bring back the joystick. no? >> candy crush is kind of like tetrus after all. what's old is new again. >> that's means we're new, too. we'll see much more of jon fortt throughout it the day. much more ahead from that big apple event. plus, some other usual suspects that tends to see big
2:19 pm
moves on apple days. we'll bring you those names ahead, bring you "street talk," those recommendations, corporate news, lots offer who stuff. stick around. >> announcer: the cnbc "real time market exchange snapshot" is spon tosored by interactive brokers. at ally bank no branches equals great rates. it's a fact. kind of like mute buttons equal danger. ...that sound good? not being on this phone call sounds good. it's not muted. was that you jason? it was geoffrey! it was jason. it could've been brenda.
2:20 pm
i take prilosec otc each morning for my frequent heartburn. because it gives me... zero heartburn! prilosec otc. the number 1 doctor-recommended frequent heartburn medicine for 9 straight years. one pill each morning. 24 hours. zero heartburn.
2:21 pm
2:22 pm
earlier in the show, we talked about some of the apple derivative plays, the high low effect, the supplier stocks that could see big moves on apple news. but there are also some unusual suspects that move in tandem with apple. speaking of apple, there's also other stuff going on. apple right now down .4%. we aren't seeing a move in apple shares right now but there's always that one more thing aspect. we'll bring that to you. oil quickly becoming a big story along with apple. oil at the low of the session, $44.34 a barrel. down 3.5%. that's bringing oil stocks down. the dow itself turned negative when oil rolled over as well. we've talked for months about the correlation between oil and the dow. guess what? oil down, the dow down again as
2:23 pm
well. s&p and nasdaq have been losing steam, too. let us now bring in eric chemmy, with the stocks you might think are core lafted but they're not. >> facebook, microsoft, ibm, the tech names that people think would be correlated to apple. according to this data from kensho, tech stocks, not that high. less than .6%. these are not names you'd want to use as a hedge, tech names that people would assume if i want to go long apple, short something -- it's not really there. what's more interesting though are the names that have even a higher correlation to apple. these are industrial names. things like illinois tool work. >> what? >> honeywell. that's what i said. what? exactly. what's going on here? is within the s&p 500, those are the three companies with the
2:24 pm
highest correlation to apple stock. these are number four and number five. wells fargo and boeing. not names you would expect. not that high, not like a .8%. if it was obviously 1.0%, that's the highest correlation. these aren't that correlated. apple is its own beast but these names that stick out, very surprising. >> illinois tool works over facebook, bizarre. more breaking news on apple tv. jon fortt. >> reporter: hey, brian. more details on this apple tv. we have pricing. the new tv that is the entry level, 32 gigabytes, starts at $149. a step up, 64 gigabytes, $199. $69 for the original apple tv. the remote has a built-in gyroscope. three months of battery life and recharge via a lightning connecter.
2:25 pm
available in october in 80 countries, 100 by the ends of the year. tim cook has taken the stage once again to talk iphone. i have a feeling we're getting toward the end of this, this is the big finish. the iphone will be called 6s. will it have force touch? we'll let you know. >> i foenls are tiphones are thf revenue for apple. apple stock just off the session lows. $111.63 is the last trade here. let's get to dom chu for a "market flash." >> here's a stock hayes not apple but up on day, talking royal caribbean stock hitting a new all-time high up by close to 2% near its best levels so far today. this stock is up 13% in 2015 and up 40% the past 12 months with the dividend yield north of 1.5%. yes on a day that's filled with apple, royal caribbean hits an
2:26 pm
all-time high. we are just hearing that from inside that convention center in san francisco, the perhaps biggest event of the day. the apple iphone refresh is starting to come out. we'll bring you headlines, video, pictures, sounds, smoke signals, whatever it takes. another big check on the markets, apple down .4%. the dow down nearly triple digits. more right after this. a number. but not every insurance company understands the life behind it. those who have served our nation. have earned the very best service in return. ♪ usaa. we know what it means to serve. get an auto insurance quote and see why 92% of our members plan to stay for life.
2:27 pm
2:28 pm
2:29 pm
hello, everyone. i'm sue herera. here's your cnbc news update at this hour. . the tea party holding a big rally in washington, d.c. to protest the iran nuclear deal. republican presidential hopefuls donald trump and ted cruz speaking to those in attendance. baltimore has approved a $6.4 million settlement with the family of freddie grey. this resolves all civil claims in the case. grey died from injuries he received while being transported in a little bit vehicle following his arrest and that led to days of rioting in the city's streets. taxi drivers across portugal
2:30 pm
protesting against uber drivers by blocking highways and causing traffic jams. they're update because uper doesn't have to abide by government rules and regulations for taxi services and they say that is unfair competition. toyota unveil is the in prius last night, the first in almost seven years. the 2016 prius will get 55 miles per gallon, about 20% better than the 2015 version and will be in dealerships early next year. you're up to date. that's the cnbc news update at this hour. >> i'll make you a bet uber app downloads surge in portugal overnight. >> i'm sure. >> that's what happens. >> i understand. they feel like they're being edged out and -- >> that's exact wrong tactic. thank you very much. sue, thank you. we're going to get oil in a second. jackie deangelis primed and ready. but sit tight for a second, back to jon out west. >> reporter: hey, brian.
2:31 pm
the first information about the new iphones. they are indeed the 6s and 6s plus, basic design on the outside as the previous generation. but tim cook says they've rethought everything inside. he claims these are the most advanced smartphones in the world. of course he would claim that. others including samsung probably beg to differ. a key feature, the first one they are talking about in some depth, 3-d touch. sounds like force touch which we've become familiar with on the apple watch. they say it is the next generation of multi-touch and that it will change the way people interaction with advicde. we will learn more and be back. jackie deangelis, oil sliding -- forgive me -- as we wrap up close. >> that's exactly right. seeing some pressure in oil prices today, almost another $2 drop on prices.
2:32 pm
closing under $45 a barrel, closer to $44. saudi production numbers for august only saw a little more than a 100,000-barrel drop. 21.26 million barrels for august. that's still a lot of production. also you had the eia out today talking about its 2015 oil demand growth forecast taking that down as well. still on the supply/demand side we have problems. we don't have supply going down enough and now demand forecasts are coming down as well. it is not just demand forecasts coming down, it is also the oil stocks that are coming down. just going to pluck one out. marathon oil, mro. that stock is down exactly 8% right now. melissa, it is down 43% this quarter. put another way -- one of america's biggest oil companies has lost 40% of its entire market value in 90 days. >> staggering.
2:33 pm
stagger staggering. this is just in. video of the new 6s and 6s plus. some details coming out about the new colors for the iphones, as well as 3-d touch formerly known as force touch. these are all features widely expected to come out with the iphone. apple shares, trading lower from when the apple eventually started. right now we are close to session lows. $111.42, down by .8%. but that's your first look at the latest iphone 6s and 6 plus. thank you very much. financial stocks down more than 8% over the past month. making that the worst performing sector in the s&p 500. let us trade the next move, not the last move, with the "trading nation" team. todd gordon, erin gibbs. todd, beginning with you.
2:34 pm
do the charts on the financial sector as a whole suggest a rebound? >> if you put them in the context of where interest rates are going. right now we've seen a push up in the 30-year bond yield up close to 3%. that would generally be a boost for financials. if you just take an overlay of your financial etf and the bond yield, there is a pretty tight correlation but recently the two have diverged. think the market weakness we are seeing on a broad base point of view is starting to impact the financials. i think the market is set for retest. we sold the stock indexes on the 1:00 p.m. online show today. we are starting to see follow through. i think they are not immune to general market weakness. >> erin gibbs, eight days from now is the fed meeting where there is a chance we could get the first interest rate increase in nine years. do you believe if we get it, whether september, october or december, we will see the financials turn around? >> yeah. because i think if we even just look quickly back at june and july, the financials were actually some of the best performing sectors because we
2:35 pm
all expected that rate hike in september. it is only in august when we started seeing the devaluation of china that we started seeing questions about whether it's going to be raised in september. then of course questions about the banks. but ultimately longer term bigger picture, the banks are really set up for good growth. they are poised to take over good, strong economy. interest rates obviously when they do raise are going to be good for banks. they've all gotten leaner and meaner, shedding non-core assets. they also just have less legal costs as they're finally getting out of a lot of these regulation legal costs. so good growth for 2016. >> you are making a case for the financials then. >> yep. >> erin, todd, thanks very much. to another "market flash." >> solara holdings is spiking right now on a bloomberg report saying it's received bids possibly from vista partners and
2:36 pm
toma bravo for a possible sale. the deal could be announced later on this week, after bloomberg said last month solera aprochd thproached that company. this is software that goes into the solara. >> it might. more apple news, "street talk," analysts recommendations of the stocks you need to know about. are you ready to not talk apple for a minute? >> yes, please. >> goldman sachs. bank of america upgrading to buy from neutral. they say the third quarter could be weak but the stock's valuation discounting that risk. they call the outlook "mostly favorable." >> it will be asked to see what these banks say about third
2:37 pm
quart quarter. yahoo!'s one we're watching today. price target cut after that irs ruling after the bell yesterday, the irs opting to not issue a tax-free ruling for the company's proposed spinoff of alibaba. the more time that passed without a positive tax outcome, they say the likelihood of it happening actually diminishes. what's plan b? ya yahoo! cou yahoo! could spin off the operating business. the stock is is up mainly because alibaba was trading positive in china. >> walgreens boots. cost cuts appear conservatives. they note the possibility of more m&a around the company. they raise the target, about 14%
2:38 pm
up side. >> this stock is up 44% in the past 12 months. that's an amazing run. imax is another one we are watching. mkh cut the price target to $40 from $50 because of the sell-off in china related stock. analyst says the shares are oversold and it isn't getting any valuation for its china business despite clear evidence the company's exhibition market remains robust. >> if people held on, they have given almost all of it back. that chart is ugly. this the under the radar stock, luxoft. a software company based in switzerland. 15% up side. analysts say that while small the company has developed as a prominent reputation in the financial services industry. also things some creative deals could be on the horizon.
2:39 pm
the average target price just under $67. he's bullish. >> we've actually had the ceo on "fast money" because, a lot of the end markets are fascinating here. you mentioned financial services that provide software to high-frequency trading firms. and also smart car. when you want climate adjustment, that's a company that provides software that enables that. >> this is why on rare days i miss "fast money" at 5:00 p.m. eastern time i end up kicking myself. >> aw. that's sweet. >> i need to tune in every day. that's a good lesson. thank you, melissa, very much. coming up -- more apple. we'll talk to investors who combined have near ly 1 billion stocks in apple. we'll see what they have to say. a lot more. stick around. >> announcer: now your "trading
2:40 pm
nation" stats of the day and a word from our sponsor.
2:41 pm
2:42 pm
my name is watson. i'm helping doctors keep people healthy. take ted here. i'm pulling together data he shared from his wearables, health records and family history, so we can analyze it. he's doing everything right... for the most part. no pain, no gain. you are a beast, ted. my name is watson. how can i help you?
2:43 pm
taking a check on the markets, we are pushing lower down to session lows for all the three major indices are at session lows. let's bring in two apple shareholders now. guys, great to have you with us. jerry, to you first. what do you think about what apple has unveiled so far and specifically about the phone? i know we are just getting details in drips and drabs right now but does that make you more confident that the iphone refresh cycle will be intact? >> i do. remember, this is a $40 billion earnings juggernaut for them and it's been basically the whole purpose behind owning the stock for the last five years, or ten, for that matter. if you think about what they needed to do, they needed to give you some new features, they
2:44 pm
needed to make people interested now, because there is a whole pifl people th group of people who haven't upgraded from the 5. i think if you're bullish you are given something to hang on to here. i think it will also lead to all these other ancillary products which apple has done such a great job of keeping people connected to. >> john, you're underweight essentially in your core portfolio and equity income portfolio. you are saying you are looking for a pullback to add to position. is a pullback at this point significant enough? it has been a fairly significant pullback and are the products that were announced today enough for you to believe that the stock has a necessary catalyst for the stock to move higher? >> two things. we are currently weighted 3%, slightly underweight as opposed to the 3.7%. yes we are looking to increase that up to a market weight.
2:45 pm
as jerry just said, everything that i've seen so far on the television watching the apple event, if i take a look at it, those are products that i want, i'm sure our clients when they are wrachg, tatching, apple tv, everything else they showed, apple is create be an ecosystem that our clients want to be involved with. over the next 12 months we think apple will be an outperformer. if you get a buying opportunity for this stock, we think absolutely. >> why is it a buying opportunity? >> we would be buying it here. apple back in august on august 2 24th was one of the few stocks we were buying. picked some up at $103. but $110 absolutely is a good buying opportunity if you want to increase your position. >> in terms of the ipad pro, not many people want to talk about the ipad because it's seen many
2:46 pm
consecutive quarters of declines in terms of unit sales. do you think the ipad pro will form apple firmly into the enterprise segment or is this a risk you may be cannibalizing the higher margin of mac book airs? >> at that size in terms of the market of the pro, i'm not worried that it is going to cannibalize or significantly add a lot. it is just too small of a niche. what it does though is it takes a little chunk out of samsung and microsoft and it gives people an alternative to go into those types of product and staying within the apple fold. so it is a protective move and i think a very effective one. as apple's shown in history, their extensions of their product lines have always pulled new people in. they've always been so creative andmakering sure people stay in their family. this is a great example of this. that's another example of what makes them as effective as they are.
2:47 pm
>> guys, thanks for your analysis. appreciate it. jerry and john. we're going to get back out to san francisco for the latest from apple. plus, a disaster dujour in the biotech space. we'll give you the name and big stock move. you are watching cnbc, first in business worldwide with a very cool apple tv app, by the way. we've got trouble in tummy town. peptocopter! ♪ when cold cuts give your belly thunder, pink relief is the first responder, so you can be a business boy wonder! ♪ fix stomach trouble fast with pepto.
2:48 pm
2:49 pm
2:50 pm
pharmaceuticals. and that stock is plummeting, losing 3/4 of its value. this morning, it had a market cap of about $1.5 billion. that is when the drug did not meet a primary goal. that stock, that is not a misprint. down 78.5%. by the way, the overall market, oil also in the red, the dow down 137 points, the worst performers, chevron as oil slides. we're back with more right after this. it can feel like this. copd includes chronic bronchitis and emphysema. spiriva is a once-daily inhaled copd maintenance treatment that helps open my airways for a full 24 hours.
2:51 pm
spiriva helps me breathe easier. spiriva respimat does not replace rescue inhalers for sudden symptoms. tell your doctor if you have kidney problems, glaucoma, trouble urinating, or an enlarged prostate. these may worsen with spiriva respimat. discuss all medicines you take, even eye drops. if your breathing suddenly worsens, your throat or tongue swells, you get hives, vision changes or eye pain or problems passing urine, stop taking spiriva respimat and call your doctor right away. side effects include sore throat, cough, dry mouth and sinus infection. nothing can reverse copd. spiriva helps me breathe better. to learn about spiriva respimat slow-moving mist, ask your doctor or visit spirivarespimat.com
2:52 pm
good. very good. you see something moving off the shelves and your first thought is to investigate the company. you are type e*. yes, investment opportunities can be anywhere... or not. but you know the difference. e*trade's bar code scanner. shorten the distance between intuition and action. e*trade opportunity is everywhere.
2:53 pm
welcome back. certain a lot has happened. now a lot of headlines, products, updates. a recap at the apple event. john? >> yeah, brian. right now, phil shiller is on stage announcing something called live photos. let me give you a little bit of a recap of what's available on this iphone 6s and 6s plus that apple hopes will continue to help it gain share over android rivals. 3d touch is the main feature they began talking about. and it sounds like it's going to be especially useful for multitasking. instead of having to use the home button to switch between applications, you'll be able to be in an e-mail and touch a part
2:54 pm
of it. other examples like that they gave, as well, instagram taking advantage for being able to navigate within a personal instagram feed. they will have an a-9 chip which apple says is between 78% and 90% faster depending on graphics, or not. other things like voice recognition always on. it's built into that chip. you don't lose image quality if you pack 50% more pix ls in compared to that camera they used to have. now up to 63 megapix ls, this will shoot 4k video, which rivals phones, already do.
2:55 pm
a five megapixel for the selfies. also the screen as mark garmin reported will act as a flash for the selfies. now you'll look better in the selfies, as well. so the two main features, 3d touch and the camera improvement. those are two features navigation and cameras that have been important to consumers we'll see if this gets people to upgrade. the 6 and 6s the most popular iphones apple has come up with. they want to improve on that, of course, with the new models. >> john, do we have price on it? >> we do not. i'm not picking up on it. but we want to hear how they frame the price and given that carriers are not emphasizing a subsidized price. are they going to say, here's how much you'll have to pay per month on most installment plans? we'll see how they frame it. >> thanks, john. great wrap-up of the phone, as well.
2:56 pm
we appreciate it. we'll see much more of john throughout the afternoon. but right now, back to our panel. dan, we'll start with you this time, again. incremental adds to the phone, the 3d, the touch. any change to your numbers or target price because of what you heard today? >> not at all. as bullish as ever. >> i think this gives you incremental confidence going into the next 12 months. it's basically a super product cycle, china, i believe bark's worse than the bite there. and you have 30% of customers that have upgraded to 6. and this is going to be the catalyst. they've laid out that product road map on iphones, on apple tv, on the ipads. i feel like you walk away from
2:57 pm
here incrementally confident regardless if the stocks are down 2%. >> are you more confident now than you were before this apple event began? >> i'm more confident that my selfie game is going to get ramped up, but not any more confident in my iphone. >> you're being your typical -- i appreciate your sort of typical demere self. why no excited? you don't want the $99 pencil? >> oh, i probably couldn't figure out half the things they announced today, and the other half, i'm not particularly interested in. i think the phones are great. i'm reasonably bullish on the stock right now just because of how dominant they are at the high end of that product category. but, i don't think there's anything like a big screen to sort of change the dynamics of the industry. >> in your note leading up to the launch, you say the shipment would go down in the first quarter of 2016, which would be the holiday quarter. do you think is enough to get people to upgrade? >> i do still feel that way.
2:58 pm
we're talking about relatively saturated market at the high end at this point. and the iphone 6 is extraordinarily, extraordinarily successful. i don't think it's hyperbole to say the most successful product in the history of the world. and that's hard to comp in a saturated environment. >> the flip side to that is that you had mentioned in your note, andrew that the 6 really created this huge upgrade cycle. the upgrades were way more. >> does that mean few er fewer will upgrade to the iphone 6? >> a lot of people are referred to the upgrades. those numbers are meaningless, you have to look at it relative to the percentages in the previous cycles and what percentage people are likely to upgrade are. we think the upgrade rates were abnormally high and those are more likely to come down in the
2:59 pm
success. >> you said it well at the beginning of the show. it's about keeping people in the eco system. maybe today wasn't about new customers in. do you think it might encourage the apple fans and those in the system to spend more with apple? >> absolutely. it only works with phones 5 and 6, you can see the sale of the apple watch driving more sale of the iphone 6 and the new iphones. it's continue to generate increased interest among the customer base. >> we're going to leave it there. dan, we're going to leave it there. melissa, you're just starting, what's on "fast money" tonight? >> apparently we're just getting pricing data. that's just coming in from the -- >> am i the only one? i had a 6, i bought a 5. >> you're such a contrarian.
3:00 pm
>> you know why? the six was tall. i had a problem with it. >> thank you very much. "closing bell." apple part 2 starts now. >> where do you find an iphone 5 these days. >> i'm looking at my pen forlornly. welcome to the "closing bell," everybody. i'm kelly evans here at the new york stock exchange. >> the dow, what a day this has been so far. losing all of this morning's early gains. energy, one of the big losers today. oil, down nearly 4%. and chevron is weighing on the dow industrial average. the dow itself was up 172 in the open this morning, now we're near the lows of the session, down 123. we will dig deeper into this move coming up in a moment.

86 Views

info Stream Only

Uploaded by TV Archive on